Investing

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I’m looking to buy an investment property. Is a holiday home a good choice?

When choosing between buying a standard residential property or a holiday home, you need to decide whether you're making a strictly financial investment, or a lifestyle choice. Ask yourself the following:
  • Will the investment property (bach) be used as a holiday home for your family with short term rentals, or will it be rented out to others long term?
  • Are you able to cover a large portion of the running costs out of your own funds, if you are unable to get rental income for much of the year?
  • What long or short-term financial goals do you have for the property?
  • Will the investment property offer you any New Zealand tax benefits?
  • Are you confident of your financial position if there is a downturn in the New Zealand holiday rental or sales market?
If you're investing in property for the first time, consider whether you'll require constant rental income to cover mortgage repayments.  If you do, a long-term residential property investment is probably more suitable for you.
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